Agreement between Dow AgroSciences and the Government of Canada

On March 31, 2009, Dow AgroSciences LLC (DAS) filed an arbitration notice against the Government of Canada under NAFTA, Chapter 11. The complaint, addressed to the Government of Canada as party to NAFTA, concerns the use and sales prohibition of 2,4-D under Québec’s Pesticides Management Code.

In its complaint, DAS argues that the Government of Canada violated Sections 1105 and 1110 of Chapter 11 of the NAFTA agreement and neglected to fulfill its obligations under these two sections by enacting the 2,4-D prohibitions in the Pesticides Management Code.

Québec took part in the federal government-DAS discussions with a view to achieving a definitive agreement prior to arbitration hearings, in accordance with habitual NAFTA mechanisms. These discussions led to a settlement agreement between the Government of Canada and DAS. The Government of Québec has pledged to the Government of Canada that it will respect of the terms of the agreement.

Contents and effect of the agreement between DAS and the Government of Canada:

• The Pesticides Management Code will remain as is, with 2,4-D listed on Schedule I : Prohibited active ingredients.
• No financial compensation will be paid to DAS.
• DAS renounces all recourse against the measures that are the subject of its arbitration request.
• The Government of Quebec agrees that products containing 2,4-D do not pose an unacceptable risk to human health or the environment, provided that the instructions on their label are followed, as concluded by Health Canada’s Pest Management Regulatory Agency in its May 16, 2008, decision on the re-evaluation of 2,4-D.